Briscoe boss to be in control after Kathmandu deal
ROD Duke will retain control of the Briscoe Group if its scrip and cash takeover of Kathmandu Holdings succeeds.
Briscoe is offering 89.7 million of its own shares and $ 32.3 million cash for the 80.1 per cent of the embattled outdoor equipment and clothing chain it doesn’t already own.
The offer amounts to $ 1.80 per Kathmandu share, based on $ 2.88 per Briscoe share, the homeware and sporting goods retailer ments.
It also amounts to a 2015 price earnings multiple of 15.5 times and an enterprise value to earnings before interest and tax multiple of 11 times, based on consensus estimates for Kathmandu’s earnings, it said.
The enterprise value of the offer is $ 418.2m. The deal would create an Australasian retailer with annual sales of
offer docu- about $ 913m and a market value $ 847m, according to a presentation.
Briscoe chief executive Mr Duke’s holding of the enlarged group will shrink to 55.1 per cent from about 80 per cent of Briscoe, ensuring he retains control. The combined group would have net debt of $ 96.8m, compared to Briscoe’s debt- free balance sheet and net cash of $ 89.7m in January.
Briscoe stock slipped 1.7 per cent to
of $ 2.85 after takeover documents were released on Wednesday, while Kathmandu dropped 2.9 per cent to $ 1.70.
There had been speculation Mr Duke would have to make a higher offer for Kathmandu, whose shares traded above $ 4 last year. Kathmandu traded at $ 1.39 before Mr Duke on Tuesday disclosed he had built a 19.9 per cent stake in the target company and intended to make a full takeover.
CHANGE ON HORIZON: If the Briscoe Group gains control of Kathmandu Holdings, there will be more than 100 stores across Australia and New Zealand.